The easy way out: in IE Tools>Windows Update, find updates and mark this one as "skip". It won't be downloaded anymore.
More difficult: uninstall .Net 1.1 from Control Panel. If it turns out you need it, install a higher version from download.microsoft.com.
Kees
After I say ok to upload a pending update, Microsoft says something like, "Security Update for Microsoft .NET Framework 1.1 SP1 on Windows XP, Windows Vista, and Windows Server 2008 x86 (KB2656353) cannot be downloaded." When I go to shut down my computer, Microsoft say something like "Install updates and shutdown. If I say yes, the next evening at shutdown time I still get the same "Install updates and shutdown" message. How do I get rid of that message? Thanks.

Chowhound
Comic Vine
GameFAQs
GameSpot
Giant Bomb
TechRepublic